Startups may not be the first businesses to spring to mind when you think of COVID-19 hardship.
But, founders are still under extreme pressure, and in the face of ongoing uncertainty, it’s more important than ever that they take care of their mental health, according to Startup Victoria chief Judy Anderson.
After Victorian Premier Daniel Andrews unveiled his extended stage four lockdown in metropolitan Melbourne, and his lengthy reopening plan, Anderson says the vibe among the city’s startups is generally frustrated.
“Everyone is frustrated that it’s taken so long, frustrated that the communication is few and far between, but they want to do the right thing, so will abide by the restrictions and work within the restrictions,” she says.
“The sooner that people feel safe, the sooner that there’s confidence, and the sooner that engine starts to move again, the better off our founders will be,” she adds.
“A lot of founders are just waiting.”
Being tech-focused, the majority of startups lend themselves fairly well to remote work, and the vast majority have been able to continue working in some capacity at least, where other businesses — beauty salons, retailers, bars and restaurants — haven’t.
But, many of them are in a situation that is “still pretty bad”, Anderson says.
For startup founders, it means there’s almost a pressure not to talk about the stress they’re under or the struggles they’re facing at this time, because there’s always someone who has it worse.
“It’s like the cousin of tall poppy syndrome,” she explains.
“We see a lot of founders not really complaining about their situation, trying to make the best of it, trying to be a good leader for their team.”
They’re particularly not talking about it in public forums.
“As a founder, if they speak out publicly, they’re also sending a really clear message to their teams,” Anderson says.
“So, I think it would be really hard to send a message of solidarity and positivity and confidence to your team and then in the public domain have a different thing to say.”
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Tech success stories?
Tech success has been something of a theme during the COVID-19 crisis. We’ve seen trends such as the rise of e-commerce and telehealth pick up speed at an unprecedented pace, while tech companies enabling remote work and online education have been booming.
But, Anderson points out that the story hasn’t been the same for every startup.
“Even though the tech community could, seemingly overnight, switch to remote work with relative ease compared to more traditional industries, they still don’t have customers, they still don’t have markets in a lot of places,” she says.
“Yes, e-commerce is booming, but what about our B2B businesses? There’s no demand. Enterprise tech has just ground to a halt,” she adds.
“No one in enterprise has a budget for new products and services, so they’re not buying.”
While many startups are using this time to focus on honing their products or services, and continuing to serve their remaining customers, that’s not necessarily sustainable in the long term.
“Tech companies haven’t been immune from redundancies,” Anderson says.
She also notes that some of the businesses experiencing huge growth are fairly fresh off the block. They’re now facing the challenge of exponential growth that they weren’t planning, or prepared, for.
“The kind of support they need isn’t stimulus — they need growth support and advice from mentors who are more experienced than them,” Anderson says.
This brings us to the effects COVID-19 has had on one of the core pillars of Victoria’s startup ecosystem, and one Anderson says is often “kind of forgotten about”: its co-working spaces.
She’s talking about locally run spaces such as The Commons, YBF, Stone & Chalk and Creative Cubes — businesses that are also enduring an enforced period of closure.
“They’re limping along, and they’re true community organisations. They want to find a way to help their founders, they want to find a way to help their members, and they just have their hands tied,” Anderson says.
“There’s only so much they can do in terms of pivoting.”
But, these spaces are crucial to startups, especially those in their early stages.
“That’s where all that serendipitous connection happens,” she says.
“That’s where you talk to someone at Friday beers in the kitchen, and you come up with an idea and you start a business.
“That’s where you get feedback on a problem you’ve been having … all of those serendipitous moments are just gone, and it’s really hard to manufacture those online.”
A marathon, not a sprint
If Anderson has one message for Victorian startup founders facing a longer lockdown and more uncertainty as the COVID-19 crisis drags on, it’s one of resilience, and a focus on wellness. Founders at all stages have to take care of themselves at this time, she says.
“More than ever, it’s a marathon, not a sprint,” she says.
“Trying not to get burnt out and focusing on wellness … I think that’s the most important thing right now for anyone.”
When you’re focusing on keeping your business afloat and constantly rolling with the punches, it stands to reason that leaders will “jump at any opportunity” to get a little more done.
But, ultimately that can do more harm than good.
It’s about “keeping your energy management in check”, Anderson says.
“You won’t be good to anyone if you go too far and get into burnout phase.”